Sales Order Terms and Conditions - Progress Rail Services

Effective as of January 1, 2011PROGRESS RAIL SERVICESSALES ORDER TERMS AND CONDITIONS1. ACCEPTANCE. These terms and conditions applyto all sales by Progress Rail Services Corporation or one of itsaffiliates stated in any related sales order or invoice (“Seller”)issued or approved by such Seller. This is an offer to sell toBuyer by Seller. Seller may revoke this offer at any point upto, an including, acceptance of the goods or services by Buyer.BUYER'S RIGHT TO ACCEPT THIS OFFER IS LIMITEDTO THESE TERMS AND CONDITIONS AND ANYPRINTED ON SELLER’S SALES ORDER OR INVOICE,AND NO TERMS OR CONDITIONS ISSUED BY BUYERADDITIONAL TO OR DIFFERENT FROM THOSE IN THISOFFER ARE BINDING ON SELLER UNLESSSPECIFICALLY AGREED TO IN WRITING AND SIGNEDBY SELLER. THERE ARE NO UNDERSTANDINGS,TERMS, CONDITIONS OR WARRANTIES NOT FULLYEXPRESSED HEREIN. ACCEPTANCE OF THESE TERMSSHALL BE EVIDENCED BY BUYER’S ACCEPTANCE OFGOODS OR SERVICES OR UPON BEGINNING OFPERFORMANCE BY SELLER.2. PURCHASE PRICE. The purchase price of thegoods or services shall be as stated on Seller’s sales order orinvoice (together with these terms and conditions, the“Agreement”); provided however, that if Seller announces ageneral price increase, the purchase price shall be revised toinclude the price increase unless the goods are scheduled forshipment or services are to be performed within thirty days ofthe price increase.3. LIMITED WARRANTIES. Seller warrants thatservices will comply with agreed upon specifications whenperformed. Seller warrants only its services and does notwarrant any goods supplied in performance of the services.However, Seller shall assign to Buyer, at Buyer's request and tothe extent they are assignable, warranties applicable to goods orservices provided by third parties and supplied by Seller inperformance of the services. The warranties in this Agreementare void and shall not apply if in the reasonable judgment ofSeller, items on which services have been performed or goodssupplied in performance of the services, have been damaged byimproper application, abuse or neglect, improper maintenanceor repair, subjected to inappropriate environmental oroperational conditions or services by third parties without priorwritten authorization from Seller. SELLER MAKES NOOTHER WARRANTIES, AND EXPRESSLY DISCLAIMSALL OTHER EXPRESS OR IMPLIED WARRANTIES,INCLUDING, BUT NOT LIMITED TO, WARRANTIES OFINFRINGEMENT, MERCHANTABILITY, FITNESS FOR APARTICULAR PURPOSE OR ANY WARRANTYRELATED TO PERFORMACNCE OR TO THESUITABILITY OF BUYER FURNISHED DESIGNS,MODIFICATIONS OF SPECIFICATIONS.4. LIMITATION OF BUYER'S REMEDIES ANDSELLER'S LIABILITY. Seller's liability hereunder shallbe limited to: (1) the assignable warranties referenced abovewith respect to goods; (2) re-performance of services; or (3)allowance of a credit, at its option. Seller's total cumulativeliability in any way arising from or pertaining to any goodssold or required to be sold, or services performed or requiredto be performed shall NOT in any case exceed the purchaseprice paid by Buyer for such goods or services. IN NOEVENT SHALL SELLER HAVE ANY LIABILITY FORCOMMERCIAL LOSS, LOST PROFITS, CLAIMS FORLABOR, OR FOR EXEMPLARY, INDIRECT,CONSEQUENTIAL OR INCIDENTAL DAMAGES OFANY TYPE, WHETHER THE CLAIM BE BASED INCONTRACT, TORT, WARRANTY, STRICT LIABILITY,NEGLIGENCE, OR OTHERWISE, AND IRRESPECTIVEIF SELLER WAS ADVISED OR AWARE THAT SUCHDAMAGES WERE POSSIBLE OR LIKELY. IT ISEXPRESSLY AGREED THAT BUYER'S REMEDIESEXPRESSED IN THIS PARAGRAPH ARE BUYER'SSOLE AND EXCLUSIVE REMEDIES. NO DELIVERYDATES ARE GUARANTEED. BUYER'S SOLE ANDEXCLUSIVE REMEDIES AND SELLER'S ONLYLIABILITY FOR ANY DELAY IN DELIVERY OFGOODS OR SERVICES SHALL BE LIMITED AS SETFORTH HEREIN. THE PROVISIONS OF THIS SECTIONSHALL SURVIVE THE ACCEPTANCE OF THE GOODSOR SERVICES SOLD HEREBY OR THE TERMINATIONOF THIS AGREEMENT FOR ANY REASON.5. FORCE MAJEURE. In addition to all otherlimitations stated herein, Seller shall not be liable for any act,omission, result or consequence, including but not limited toany delay in delivery or performance, which is due to any actof God, the performance of any government order, any orderbearing priority rating or order placed under any allocationprogram (mandatory or voluntary) established pursuant tolaw or industry; local labor shortage; fire, flood or othercasualty; governmental regulation or requirement; shortageor failure of raw material, supply, fuel, power ortransportation; breakdown of equipment; civil insurrection;terrorism; any strike or labor dispute or shortage, howeverarising; or any cause beyond Seller's reasonable control,whether of similar or dissimilar nature, to those aboveenumerated.6. BUYER'S OBLIGATION TO PASS ONLIMITATION OF WARRANTIES AND REMEDIES.In order to protect Seller against claims by any purchaserfrom Buyer, if Buyer resells any of the goods or servicespurchased under this Agreement, Buyer shall include thelanguage contained in paragraphs 3 and 4 of this Agreement,dealing with Seller's warranties and limitations of warrantiesand remedies, in an enforceable agreement with Buyer's1144621-2

Effective as of January 1, 2011buyer. Buyer shall also include a provision in its agreementwith its buyer applying Alabama law to any claims its buyermight assert against Seller with respect to goods or servicesprovided by Seller, and requiring its buyer to bring any suchaction against Seller either in the state or federal courts servingMarshall County, in Alabama. Buyer shall defend, indemnifyand hold Seller harmless from any and all claims, causes ofaction, damages, losses or expenses (including reasonableattorney’s fees) that Seller incurs by reason of Buyer's failureto comply with this paragraph. The provisions of this sectionshall survive the acceptance of the goods or services soldhereby or the termination of this Agreement for any reason.7. SHIPMENT/PASSAGE OF TITLE. All goodsshall be shipped Ex Works Seller’s facility (Incoterms 2010).Title to the goods sold hereunder shall pass to Buyer upondelivery to the carrier at the point of shipment. WithoutSeller’s prior, written permission, neither Buyer nor Buyer’sconsignee shall have the right to divert or reconsign suchshipment to any destination other than specified in the bill oflading. Seller reserves the right to select the mode oftransportation.8. PAYMENTS AND LATE CHARGES ON PASTDUE ACCOUNTS. If Buyer fails to comply with anyprovision of the Agreement or fails to make payments pursuantto the Agreement or any other agreement between Buyer andSeller, Seller may at its option defer shipments or performanceor, without waiving any other rights it may have, terminate thisAgreement without liability. All offers shall be subject to theapproval of Seller's Credit Department. Seller reserves theright before making any delivery, or providing any service, torequire payment in cash or security for payment, and if Buyerfails to comply with such requirement, Seller may terminatethis agreement. A late charge of 1½% monthly (18% annualrate) or the maximum allowed by state law, if less, will beimposed on all past due accounts.9. CLAIMS BY BUYER. Buyer shall thoroughlyinspect goods and services sold under this Agreementimmediately upon receipt to verify that the goods conform tothe specifications of the Agreement. Buyer must notify Sellerof claims for failure or delay in delivery within ten (10) daysafter the scheduled delivery date. Buyer must notify Seller ofany claims for nonconforming or defective goods or serviceswithin ten (10) days after receipt, or any claim related to suchgoods or services shall be waived. In addition, Seller must begiven an opportunity to investigate the claim before Buyerdisposes of the goods or else Buyer's claim will be barred.Seller shall incur no liability for damage, shortages, or othercause alleged to have occurred or existed at or prior to deliveryto the carrier unless Buyer shall have entered full detailsthereof on its receipt to the carrier.10. PERMISSIBLE VARIATIONS. The goods soldhereunder shall be subject to standard manufacturingvariations, tolerances and classifications of the Seller and in theindustry.11. TECHNICAL ADVICE. Buyer represents that ithas made its own independent determination that the goodsor services it is purchasing under this Agreement meet thedesign requirements of Buyer's project and are suitable forBuyer's intended application. Buyer further represents that ithas not relied in any respect on any written or oral statementsor advice from Seller.12. TAXES. No tax imposed in respect of the sale ofthe goods or services sold hereunder is included. Any suchtax shall be added to, and paid by Buyer as part of, thepurchase price.13. INDEMNITY. To the fullest extent allowable by law,Buyer shall defend, indemnify and hold harmless the Sellerand its officers, directors, employees, agents, representativesand affiliates from any and all loss, liability, claim, cause ofaction, cost, judgment, or damages, including reasonableattorney fees for any personal injury, death, propertydamage, or economic loss of any sort related to any act oromission of the Buyer or use or abuse of the goods by theBuyer or any third party receiving, using or abusing thegoods after Buyer’s receipt without regard to whether anyloss is based upon breach of contract, breach of warranty,negligence, strict liability, or other tort or contract theory orcause of action.14. WAIVER. Failure or inability of either party toenforce any right hereunder shall not waive any right inrespect to any other or future rights or occurrences.15. PERIOD OF LIMITATIONS. Buyer and Selleragree that any action by Buyer against Seller for breach ofthis Agreement, including any action for breach of warranty,or otherwise in connection with the goods or services soldunder this Agreement, must be commenced by Buyer againstSeller within one year after the cause of action accrues.16. SEVERABILITY. In case any provision of thisAgreement shall be declared invalid, illegal orunenforceable, the validity, legality and enforceability of theremaining provisions shall not in any way be affected orimpaired.17. APPLICABLE LAW. The United NationsConvention on Contracts for the International Sale of Goods(1980) shall not apply to this Agreement. This Agreementshall be governed by, and construed and enforced inaccordance with, the laws of the State of Alabama. Buyerand Seller, each as part of the consideration hereof, agree tothe exclusive venue and jurisdiction of, and specificallyagree that any legal action brought relating to this Agreementor goods or services provided will be brought and triedexclusively in the state or federal courts serving MarshallCounty, Alabama.1144621-2